Reneau J. Longoria, Esq.

July 2023

You cannot have it both ways

When a Chapter 7 bankruptcy debtor receives a discharge of their debts, they are no longer personally liable for the payment obligations under the Mortgage Loan. Nevertheless, if the debtor plans to stay in the property, then the payments have to be made. On August 10, 2016, Deutsche Bank National Trust Company (“DBNT”) started a judicial foreclosure action to foreclose the Pitassi Mortgage in the Connecticut Superior Court.  At first the Pitassis did not initially appear to defend the judicial foreclosure action and, as a result, Default Judgment entered in favor of DBNT. On January 17, 2018, the Pitassis, through Counsel, filed a motion to Vacate and Open Judgment of Default and a Motion to Dismiss for Lack of Subject Matter Jurisdiction, to which DBNT objected.  The Connecticut Superior Court subsequently denied the Pitassis’ motion on June 8, 2018.  The Pitassis filed multiple appeals that were dismissed by the Connecticut Courts.

The Pitassis originally filed a Chapter 7 Bankruptcy Petition in 2011 and obtained their Chapter 7 discharges. The Pitassis’ initial Chapter 7 Bankruptcy Petition stated that they did not have any potential unliquidated claims other than those at issue in the matter of Kassi v. Chase Bank, which did not involve DBNT’s mortgage loan. On August 10, 2022, Kassiani Pitassi filed a second bankruptcy petition under Chapter 13 of the United States Bankruptcy Code, this time in Maine, however, her proposed plan did not provide for the payment of either of the mortgages on her very valuable, mortgaged premises in Connecticut, which were long in default.  Rather, Pitassi raised challenges to DBNT’s standing to enforce the mortgage loan in the non-standard provisions of her proposed plan. Because Pitassi obtained a discharge of her personal liability for the debt owed under DBNT’s mortgage loan based on the representation that she did not have any unliquidated claims related to the same, and Pitassi’s challenges to DBNT’s standing were previously rejected by the Connecticut Courts, the Bankruptcy Court refused to confirm Pitassi’s Chapter 13 plan as a matter of law based on Judicial Estoppel and the Rocker-Feldman Doctrine. See Ribadeneira v. New Balance Athletics, Inc, 65 4^th 1, 27 (2023); Rooker v. Fidelity Trust Co., 263 U.S. 413 (1923); District of Columbia Court of Appeals v. Feldman, 460 U.S. 462 (1983).

The Pitassis should be estopped as a matter of law from attempting to collaterally attack the Connecticut Superior Court Judgment in the Bankruptcy Court proceedings because they received the benefit of their Bankruptcy discharge, yet they still sought to challenge the Mortgage lien at issue in this matter as their initial attempts to do so failed in the Connecticut Courts. A debtor cannot have the best of both worlds. Courts should not condone the practice by a debtor of obtaining a Chapter 7 discharge of their personal liability and then remaining in the property or, in this case, collecting rents derived from an investment property, while they continue to challenge the lender’s ability to foreclose the mortgage lien thereon.

Pitassi Appeal Brief

“Absent any good explanation, a party shall not be allowed to gain an advantage by litigating on one theory, and then seek an inconsistent advantage by pursuing an incompatible theory.” Ribadeneira v. New Balance Athletics, Inc,
65 F. 4th 1, 27 (1st Cir. 2023)

Reneau J. Longoria, Esq.

April 2023

Maine Foreclosures: Mortgagee’s Interest in Property is not
affected by the death of a Joint Tenant

On January 17, 2023, the Law Court invited amicus briefs on whether a “debtor” is an indispensable party in a foreclosure when the debtor is deceased, time for probate has passed, and the property is owned by a surviving joint tenant who is not liable on the note. That briefing will be argued Thursday April 6, 2023, in Augusta, Maine.

The Federal vs State conflict in the analysis of necessary parties to a Mortgage Foreclosure and Sale action as set forth in MTGLQ Investors, L.P. v. Alley, 2017 ME 145, 166 A.3d 1002, (“Alley”) in contrast with the U.S. District Court’s decision in Johnson-Toothaker v. Bayview Loan Servicing LLC, Civil Action No. 20-CV-00371-JDL, 2022 WL 3278883 (2022)(“Toothaker”) is the heart of the controversy.  The Alley Court reversed the Trial Court Foreclosure Judgment in favor of MTGLQ, sua sponte, and ordered that the complaint be dismissed without prejudice where it named neither the (deceased) debtor nor the debtor’s estate. In Toothaker, the District Court reasoned that because Maine is a title theory state, a mortgage is enforceable even if the note is not, and, it follows that the deceased debtor or his/her estate are not necessary parties to a foreclosure.

DGL submitted the attached Amicus brief taking the position that the Alley decision was incorrect, the correct parties were named and no more was required given the fact that one of the two joint tenants survived and was named in the foreclosure action.  The Plaintiff did not advance a claim on the Keniston Note and made it clear only an in rem judgment extinguishing the remaining joint tenant’s interest in the property was sought. There was no “missing party;” in fact, given the status of the joint tenancy, the naming of the heirs was superfluous and, as a result, the matter should not have been dismissed.  In a title theory state such as Maine, naming the remaining joint tenant is all that is necessary to foreclose the mortgage lien.  The mortgagee’s interest in the property was not impacted by the death of one of two joint tenants and no formal administration of the deceased tenant was required to foreclose the right of redemption and enforce its mortgage lien.  

Keniston Amicus Brief

We advocated for adherence to the fundamental principles of Joint Tenancy in a Title Theory State:  A mortgagee’s interest in property is not impacted by the death of one of two joint tenants and no formal administration of the estate of a deceased joint tenant is required to foreclose a right of redemption and enforce a mortgage lien.

Doonan, Graves & Longoria, LLC
Overcomes Defendant’s Attempt to Invoke the Rooker-Feldman Doctrine 
to avoid a Federal Claim for Possession

Reneau J. Longoria, Esq.

September 29, 2022

MAINE FORECLOSURES:
Is it time for a return to pre-2014 jurisprudence?

“On August 23, 2022, [The Law Court] signaled it may be time to reconsider the breadth and depth of the Deschaine and Pushard Decisions and to provide clarity both on what this Court intended in those decisions, and whether Deschaine and its progeny were consistent with Maine law prior to 2017 when decided.” [AB 5]

“In short, a residential, judicial foreclosure in a title theory state is, by statute, an action in equity designed only to remove the equitable right of redemption and should never have preclusive effect on subsequent foreclosures.” [AB 15]

“Like this Court’s decision in The Bank of New York Mellon v. Shone, 2020 ME 122, 238 A.3d 671, this case presents an opportunity to resolve the conflict between the Deschaine and Pushard precedent and prior decisions grounded in Maine title theory, See U.S. Bank Nat’l Ass’n v. Gordon, 2020 ME 33, ¶¶ 15-30, 227A.3d 577 (Horton, J., concurring) (outlining the recent departure from precedent dating back to the nineteenth century).” [AB 7]

We will keep you informed of the decision. Please reach out to schedule in-person or virtual DGL Knowledge Exchanges to discuss strategies on your particular cases during these changing times.

We think the time was right to respectfully advocate for a change in the law in the hopes of returning Maine to its roots in title theory.  We filed our Amicus Brief with that in mind.

Brian C. Linehan, Esq.

August 2022

FORECLOSURE BY ENTRY

Physical entry on the property, recordation of a Certificate of Entry and expiration of three year-redemption period = the third, independent path to foreclosure in Massachusetts

A defective contractual notice of default does not affect the validity of a foreclosure by entry.

In Emigrant Mortgage Company, Inc. v. Bourke, 2022 WL 3566832, --- F.Supp.3d --- (D.Mass. Aug. 18, 2022)(“Bourke II”), the U.S. District Court reviewed the potential effect that a defective contractual notice of default may have on a mortgagee’s foreclosure by entry and possession under G.L. c. 244, § 1. Following a failed summary process action for possession, which was dismissed on appeal as a result of defects in the mortgagee’s contractual notice of default that rendered the mortgagee’s foreclosure by exercise of the statutory power of sale void, see Retained Realty, Inc. v. Bourke, 2019 Mass.App.Div. 183, at *2-3, the foreclosure sale purchaser brought a subsequent action in the U.S. District Court seeking to recover possession of the foreclosed premises based upon the mortgagee’s foreclosure by entry and possession. Bourke II, 2022 WL 3566832, at *2. Unlike a foreclosure by exercise of the statutory power of sale, which is a remedy that is incorporated into the terms of the mortgage contract, a foreclosure by entry and possession is purely statutory. Cf. id. at * 4-5. Accordingly, the U.S. District Court determined that compliance with the terms of the mortgage – specifically the contractual notice requirement found in paragraph 22 – is not required to affect a valid foreclosure by entry and possession under G.L. c. 244, § 1. See id. at *5.”

 A link to an article in Massachusetts Lawyers Weekly about this matter has been linked below:

https://masslawyersweekly.com/2022/08/26/mortgages-res-judicata-foreclosure-by-entry/

“Foreclosure by entry . . . does not require the mortgagee to send a notice pursuant to ¶ 22 [of the mortgage contract] before making an entry for possession...  The Defect in the notice of default sent by Emigrant is thus irrelevant to the question of whether the plaintiffs may proceed with foreclosure by entry.”

Judge Gorton

Reneau J. Longoria, Esq.

January 2022

Doonan, Graves & Longoria, LLC (“DG&L”) is proud to announce that
Reneau J. Longoria, Esq. has assumed responsibilities as Managing Member, effective October 15, 2021.  Attorney Longoria previously managed the practice areas of Foreclosure, Litigation, and Bankruptcy.  As the Managing Member, she will continue to serve and support the attorneys and staff in the firm’s default, appellate and general practice in Massachusetts, Maine and New Hampshire, as well as assuming duties in the management of the business.  

Attorney Longoria’s dedication and energy has remained consistent from her first eight years in criminal practice wherein she held positions with the Department of Justice, United States Attorney’s Offices in Texas and Washington, the Rockland County District Attorney’s Office in New York and the Attorney General’s Office in Texas.  Attorney Longoria is barred in Massachusetts, Maine, New York, New Hampshire, Texas, Montana, the U.S. District Courts in Maine and Massachusetts, as well as the First, Second and Fifth Circuit Courts of Appeals and the U.S. Supreme Court.  Attorney Longoria joined the firm in 1996 and became a Member in 2001.

Attorney Longoria states that she is “passionate about leading the firm forward as we build on our success and continue to strive for ‘Excellence. Daily.’ in these changing times.”   Attorney Longoria explained, “the Pandemic presented many challenges to businesses world-wide and the Default Industry in particular.”
 “Our dedication to overcoming those challenges through innovation, resiliency and personal sacrifice, while protecting the health and safety of our staff and clients, demonstrates that, together, we have the strength for the next chapter in the firm’s history.”  “I believe our next chapter will be our best chapter yet and I plan to lead this firm forward from the Pandemic healthier mentally, physically and financially.”  “As a result of DG&L’s ability to adapt to the changes in the industry during the Pandemic, DG&L has, and will continue to distinguish itself, and provide our clients with exceptional legal service.” 

“Reneau is held in the highest regard by both the Bar and the Bench where she is a supremely effective advocate for our clients.  There is no doubt in my mind or soul that the firm’s future is in
excellent hands for many years to come.”

John A. Doonan